Seeley

I. BACKGROUND

This case revolves around sales of three Palm Springs area properties. In 2017, Intervention911 was operating the properties as detox, sober living, and residential recovery facilities, when its owners—Seeley and McLaughlin—were approached by Urwell Diversified Holdings, Inc. (Urwell) with proposals to purchase both Intervention 911 and the properties. Negotiations resulted in Seeley and McLaughlin (the sellers) and Urwell entering into two different sets of transactions—one pertaining to the three properties (the real estate sale transactions) and the other pertaining to Intervention911 (the business sale transactions). A. The Real Estate Sale Transactions With regard to the real estate sale transactions, the sellers agreed to Urwell’s proposal that each of the three sales be financed with a loan by the sellers in what is commonly referred to as seller financing or a carryback loan. In addition, though Urwell initially proposed that the carryback loans be secured by the lien of a deed of trust in second priority position, it and the sellers ended up agreeing that each of these loans instead would be secured in first priority position. To effectuate the real…